Rax Company has developed the following standards for one of its products:

Direct materials 12 pounds 14 per pound

Direct labour 3 hours 18 per hour

Variable overhead 3 hours 8 per hour

The following activities occurred during the month of October:

Materials purchased 10,000 pounds at 13.60 per pound

Materials used 9,000 pounds

Units produced 800 units

Direct labour 2,500 hours at 19.00 per hour

Actual variable overhead 22,000

The company records materials price variances at the time of purchase.

If actual fixed overhead was 120,000 and there was a 2,600 favorable spending variance and a 2,000 unfavorable volume variance, budgeted fixed overhead must have been

122,600.

122,000.

120,000.

124,600.